Over the weekend, it was announced that Les Moonves, Chairman
and CEO of CBS, stepped down from his posts as the sexual misconduct
allegations against him increased in quantity and details. With the announcement, came word that CBS had
reached a lawsuit settlement with its controlling shareholder, National
Amusements Inc. (NAI) that included the replacement of 6 members of the CBS Board
of Directors and a commitment by NAI to not propose a merger with Viacom for at
least 2 years from the date of the settlement.
(It doesn’t mean others can’t.)
In the [short-run or long-run] moment of dysfunction at CBS,
does it present opportunity for a CBS merger or acquisition by/with others in
the media space? Let’s assume it does
and speculate, one more time, on who those partners/buyers might be.
The other broadcasters (ABC, FOX, NBC) are out as they are
busy making other deals AND there is that thing called antitrust that will prevent any of those tie-ups from happening. Likewise, the wireless carriers are out as
AT&T is busy fighting to keep Time Warner, Verizon has expressed little/no
interest in content, and T-Mobile and Sprint are awaiting regulatory approval
of their merger. Then, there are small
content players like Discovery. They are not in the financial positions to be acquirers. The FAANG firms (ex-Netflix) could be potential
acquirers with the underlying motivation to accelerate content ownership and
scale. The streaming music service,
Spotify, is a potential suitor as it already partners with Hulu and Showtime
(owned by CBS) and it could be interested in video content to get at economies
of scope and a more diversified portfolio (bundle) of services that it goes
direct to the consumer with. But,
lastly, I come back (again) to Lionsgate.
Lionsgate with CBS (and Viacom) makes a lot of sense as it would greatly
increase its leverage in content negotiations with oligopolistic distributors at
the box office and on the small screens.
|
Firm
|
Market Share
|
|||||
|
2017
|
2016
|
2015
|
2014
|
2013
|
Avg. 2013-2017
|
|
|
Disney
|
21.8
|
26.3
|
19.8
|
14.9
|
14.9
|
19.5
|
|
Time Warner (WB/New Line)
|
18.4
|
16.7
|
16.9
|
18.8
|
21.3
|
18.4
|
|
NBC/Universal
|
15.0
|
14.1
|
22.3
|
11.4
|
13.3
|
15.2
|
|
News Corporation (AT&T/Fox)
|
12.9
|
13.3
|
12.4
|
17.9
|
10.2
|
13.3
|
|
Sony
|
9.8
|
8.3
|
8.9
|
12.0
|
10.6
|
9.9
|
|
Lionsgate
|
8.0
|
5.8
|
5.9
|
6.8
|
9.3
|
7.2
|
|
Viacom (Paramount)
|
4.8
|
7.7
|
5.9
|
9.7
|
8.4
|
7.3
|
|
% of Box Office
|
90.7
|
92.2
|
92.1
|
91.5
|
88.0
|
90.9
|
|
Combined Disney/Fox
|
34.7
|
39.6
|
32.2
|
32.8
|
25.1
|
32.9
|
|
Combined Lionsgate/Viacom
|
12.8
|
13.5
|
11.8
|
16.5
|
17.7
|
14.5
|
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